Sub-Lease Agreements
Sublease agreements allow a tenant to give possession of some or all of their leased premises to a third party. The right to sublet is governed by state laws and the terms of the original lease. Generally, the original lessor is still potentially liable to the landlord for rent and damages under the Master Lease even if he does not occupy the premises after the sublease ends. Sublease agreements are ideal for situations where a lessor will be away for a period of weeks or months, but is intending to reoccupy the premises.
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Right to Sublet
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The first place to look for a right to sublet a unit is on your original lease and in your state's laws. Some states, such as New York, have a statutory right to sublet that overrides any clause in the lease that prohibits subleasing. Even so, there may be a specific procedure to follow before you sublease, and you may have to get the landlord's permission.
Essential Terms
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A sublease agreement must contain a description of the premises being leased, the names of the lessor and sublessor and a reference to the Master Lease. In addition, the agreement should make explicit the period or term of the sublease, the amount of rent due by the sublessor and the due date for rent payments. The term of the sublease should not exceed the duration of the Master Lease.
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Terms of Original Lease
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If you are subleasing your unit, you will mostly likely want to include additional terms in the sublease agreement for your protection. Most importantly, the sublessor should agree to abide by all the terms of the original lease and refrain from any activity or behavior that would breach the Master Lease or cause the lessor to default on their obligations to the landlord.
Indemnification
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A sublease does not free the lessor from obligations to the landlord under the Master Lease. If rent is not paid or the property is damaged, the landlord could pursue collection from either the original lessor, the sublessor or both, regardless of who was responsible. For this reason, a sublease agreement should contain an indemnification clause stating that the sublessor will repay any money the lessor is forced to pay the landlord as a result of the sublessor's failure to pay rent or damage to the property.
Assignment
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If you are planning on leaving your leased premises permanently, it might make more sense to assign your lease to a new lessor rather than executing a sublease agreement. Your landlord probably has discretion under state law to prohibit you from assigning your lease to someone else. If you are able to assign your lease, however, you sever the legal relationship between yourself and the landlord, and the new lessor assumes total responsibility under the lease.
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References
Resources
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